Austria is now planning to regulate cryptocurrencies as gold derivatives, clipping the wings of investors who were hoping to go mostly unnoticed by the state. The country is now hoping that the European Union will come jointly on the matter and offer a similar solution.
Regulators from all across the world are now looking closely into cryptocurrencies. These assets are decentralized, and as such they tend to be elusive. What gives reasons for concerns is not the rather unfathomable nature of, say, bitcoin, but the fact that it may be utilized to facilitate organized crime.
It has been proven that bitcoin and similar assets have been used to facilitate crime. Whether it is drugs or corruption, greasing palms with digital chunks of gold is becoming the norm in the realm of the blockchain-powered money, and that in turn is reason for concern.
A Minister Speaks Up
Austrian Finance Minister Hartwig Loeger has said that by equating digital gold to actual precious metals, criminals may be prevented from using this medium as a way to put forth their own interests.
“Cryptocurrencies are significantly gaining importance in the fight against money laundering and terrorism financing,” Loeger said in a statement, according to a Bloomberg report. “That’s an important aspect for the changes we support. We need more trust and more security.”
Mr Loeger believes that Initial Coin Offerings should have the same status as securities, which will in turn force those issuing them to register “digital prospectuses.” As a result, regulators will have to give the greenlight before any transaction may be carried away.
Naturally, this does not appeal to crypto enthusiasts and traders who believe that anonymity is one of the lasting tenets of the cryptocurrency and people who are actively involved in the segment do take a personal offence at the suggestions that they may be regulated.
Mr Loeger made another good point, explaining that the because bitcoin and similar assets are not a matter of nationality, an international regulatory framework is sorely needed.
Austria is now moving on cryptocurrencies as a result of an earlier mishap with an Austria-based investment initiative by the name of Optioment cheated 10,000 investors for the sum total of over USD 100 million.
A similar move has already been kick started in France, meaning that the EU may have enough common ground among partners to launch a pan-European initiative that could hopefully also have world-wide repercussions.